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May 4, 2013

Envestnet Unveils ‘Intelligence’ Initiative at Advisor Summit

It’s a ‘competitive advantage for their advisors,’ says Sallie Krawheck in commenting on Envestnet's new service for affiliated advisors

Envestnet executives met with members of the media on Friday morning at its 2013 Advisor Summit in Chicago to discuss the rollout of its new Envestnet Intelligence initiative, the announcement of which came the day before.

Specifically, the company described the initiative as “an innovative capability for delivering fiduciary-level investment advice. [It] responds to advisors’ need for infrastructure and services to help meet increasingly high standards of client-centered service. [It] incorporates advanced business and advisory analytics; guidance and investments for goal-based asset allocation; overlay services; as well as timely news and analysis,” among other services.

It’s an answer to the ever-increasing need for speed requested by advisors, added Jay Hummel, president and chief operation officer of Cincinnati-based Lenox Wealth Management, who had consulted with Envestnet (ENV) on the initiative.

“If gold falls out of the sky, clients want to know our strategy to deal with it on the same day,” Hummel said. “It used to be a three- or four-day turnaround, but no longer.”

It will also cause Hummel to think differently about how he hires and trains his firm’s staff.

“To say this is a game changer really undersells it,” he added.

Industry veteran Sallie Krawcheck was on hand to deliver the event's closing keynote that morning, and noted she has been informally consulting with Crager and Envestnet on the development and rollout of Envestnet Intelligence.

“Information is coming at us so fast,” Krawcheck said. “It’s one thing to look at and analyze after the fact, but how do you get in it in real time? This allows the advisor to do it.”

She noted that large firms like Merrill Lynch used to roll out new technology every 7 to 10 years that would cost it “hundreds of millions of dollars.” That's no longer the case.

“How do you take all this stuff and make it actionable and understandable?” Krawcheck rhetorically asked. “Where the heck is Cyprus? What’s going on over there, right? These guys have systematized it, which makes it a competitive advantage for their advisors.”

Envestnet executive vice president Jim Patrick added that components of the system are available today, and others will be released over the coming year. He also said some components will have a cost to the advisor, while others will not.